Category Archives: It’s Just Bidness

It still blows me away how so many people thought the Pac-12’s hire of Scott as its conference commissioner was something of sheer brilliance. The reality is that he’s a putz.

The result of the major missteps with the Pac-12 Network is awful payouts to the conference members. While Big Ten and SEC teams are hauling in around $8 million a year from their TV deal, the Pac-12 dished out a paltry $2.5 million to its members in 2017. When the network launched, the schools were expecting between $5 million and $6 million per year. Now that looks like a pipe dream.

Meanwhile, in overall revenue distribution, the conference Scott oversees lags far behind. The Big Ten paid out nearly $35 million per school in 2016 and the SEC dished out $40.5 million per member. The Pac-12 sent out $28.7 million, a number far below expectations. In 2017, the SEC paid out $40.9 million per school, while the Pac-12 is expected to sit right near $29 million.

Oh, and if that wasn’t enough, Scott is the highest-paid conference commissioner, taking home more than $4 million a year. He’s making more yearly than the universities he oversees make off the conference’s television deal.

Though if he’s a putz, I hate to think what that makes the people who hired him.

It was that kind of weird and wonderful night Thursday at the Coca-Cola Roxy at Battery Park. DawgNation brought back the core leadership group of Georgia’s 2017 team to say thanks to them and to show appreciation to the many sponsors and readers that followed the Bulldogs every step of the way this past season. In turn, those players shared background and anecdotes about the 13-2 season, which included a win over Oklahoma in the Rose Bowl and and a dramatic overtime loss to Alabama National Championship Game at Mercedes Benz Stadium.

It was considered one of the most special seasons in Georgia history. And it was, according to Chubb, Michel, Davin Bellamy, Lorenzo Carter and Roquan Smith .The quintet posed for pictures, signed autographs, swapped stories and hobnobbed witDawgNation sponsors and fans in the Roxy’s expansive venue next to the Braves’ SunTrust Park. The whole affair was quite a study in free enterprise and adulation.

Chubb, Michel and Smith were the feature act. They were the paid stars originally booked and contracted through their respective representatives to be featured at this event. Bellamy and Carter came on board when the buzz began to swell and it became clear that hundreds of fans planned to participate. When the official announcement was released via social media, good buddies Bellamy and Carter raised their hands to be included, and were.

“The whole affair was quite a study in free enterprise…” Just wondering from those of you in the it’s what’s on the front of the jersey that matters camp: should the five have had to share what they received with the school? And, hypothetically speaking, had this event been put on a year ago and the five paid for it then, would that have ruined last season for you?

Big 12: “The conference reported nearly $371 million in revenue for a fiscal year that ended June 30, 2017… the per-school payouts to roughly $34.3 million…”

SEC: “… the 14-team Southeastern Conference’s returns showed $650 million in revenue, or an average of about $41 million per school.”

ACC: “… $373 million for fiscal 2016, distributing that money among 14 full members and Notre Dame…”

Pac-12: “The Pac-12 reported that it distributed an average of $28.7 million per school in fiscal 2016.”

Big Ten: “Citing a document from the University of Michigan, the Detroit Free Press reported in June that it was projecting revenue from the Big Ten of $51.1 million for the 2018 fiscal year (the one that’s ongoing), up from $36.3 million for 2017.”

As the cliché goes, one of those numbers is not like the others.

A $10 million a year revenue gap between the SEC and Big Ten? I’m sure Greg Sankey’s bosses will shrug that off, just like they did before… oh, wait.

But the bigger theme emerging from this cycle thus far isn’t as much about the expected movement, which will be underwhelming compared to the past few years, but rather the blatant attempt by some schools to wiggle out of hefty buyouts.

This is now a strategy for schools looking for a cheaper way out of their basketball problems: Fire a coach “for cause,” concoct a set of issues that purport to show how the coach violated his contract, then wait for the lawsuit to come so that negotiations on a new buyout number can begin before the depositions.

Moar lawyers, babee!

On the plus side, at least it’s starting to dawn on some athletic directors that they’re dishing out ridiculous buyout deals in contracts. Progress, of a sorts.

I’ve mentioned many times now that it’s not the romanticism per se of amateurism’s defenders I find frustrating — I was once there too, you know — it’s the attempt to dress it up in economic clothing by folks who really don’t know what they’re talking about. For you, I strongly recommend this piece by Andy Schwarz. In particular, I’d love to hear you address his concluding remarks (and question):

So, class, what have we learned?

The real moral of the story is that the price of the middling college basketball player playing for the large swathe of schools outside the Top 100 is ONLY going to rise if that athlete is perceived to generate more value than the cost of a scholarship alone. His price cannot get bid up higher than someone can “afford” because if no one can afford $60, then his price will be less than $60. We know someone is willing to pay $50 (in scholarship) so perhaps his final price is $55, or $58, but he won’t sit on the market with a price tag of $60 and go unpurchased because $60 doesn’t happen without a willing bidder, and a willing bidder, by definition, can “afford” him.

And thus, I beg you dear reader, please do not argue that an open market for athlete talent will mean that no one can afford talent. Prices in markets do not come from a holy mountain and land, unchangeable and eternal, into the marketplace. They are set by bids and acceptances and unless your argument is that kids will prefer to go work at McDonald’s rather than accept a full scholarship, then no one who is worth a full scholarship today is going to lose a slot on the team because he’s suddenly “too expensive”

You only get ‘expensive” in a market if someone wants to pay you more than the old price. Which means someone CAN afford it. And if no one can afford more, then the price stays the same as before. Got it?

So please, please, please, when someone says “if athletes can get paid then only a few schools will be able to afford athletes” please ask them what the price will be of all the athletes who don’t go to those few schools and why all the poor schools can’t just offer all of the remaining athletes a scholarship, just like today?”

There isn’t a whole lot of mystery there. It’s how life works, at least in the rest of the economy where prices aren’t being fixed.

If you don’t mind, in the responses, you don’t need to go “I don’t like paying players” on me. I respect that position, as long as that’s all there is to it. I’m more curious to hear your criticisms of Schwarz’ argument.

Quote Of The Day

“Being a student at Georgia and playing ball, I’ve definitely grown, widened my horizons and experienced things I never thought I would. I feel like I’ve grown on and off the field, and the university prepared me for that. I’ve done some awesome things and met some awesome people. I’ll definitely be back to finish my schoolwork, because that was a big priority for me and my family and weighed heavily on my decision. I know football won’t last forever. It’ll be great to come back and get that degree, so I can tell my kids about it one day.” — Roquan Smith, AJ-C, 3/7/18